Fannie Mae sells $2 billion in bills at higher yields

DeborahLevine

NEW YORK (MarketWatch) -- Mortgage giant Fannie Mae
FNM, -12.50%
sold $2 billion in short-term debt Wednesday, although at higher yields than in recent auctions. The agency also had to pay a higher amount in comparison to U.S. Treasurys, considered among the safest asset to own, indicating investors see a greater risk in holding the agency's debt. Fannie sold $1 billion in three-month bills at a rate of 2.58%, which is 91 basis points, or 0.91%, above Treasurys with similar maturities. Last week, it sold the same amount of the securities at 2.50%, which was 85 basis points above Treasurys. The agency also sold on Wednesday $1 billion in six-month bills at 2.87%, or 96 basis points more than government debt. That compares with a week-earlier sale at 2.81%, with a spread of 89 basis points above Treasurys.

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